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Cyprus

Troika technocrats due in Cyprus next month

A troika delegation

A team of troika technocrats are due in Cyprus from September 26 to 30 to look at outstanding matters from the island’s adjustment programme, particularly with regard to reforms, CNA reported on Wednesday.

Cyprus exited its €10bn bailout programme in March this year.

This will be the first visit of troika technocrats since. Under the programme such visits will take place every six months until Cyprus pays back 73 per cent of its loan.

Technocrats will monitor progress on specific issues related to the financial sector, fiscal, macroeconomic issues and reforms at the end of every mission and prepare separate reports on progress achieved.

Although there will be no deadlines or penalties if some recommendations or reforms have not been implemented, as was the case when Cyprus was in the adjustment programme, it is important, according to CNA sources, that positive progress is seen because it will contribute to upgrading by the rating agencies.

Finance Minister Harris Georgiades warned on Tuesday that a failure to pass a government proposed bill linking public payroll to the economy’s performance, which is awaiting parliament’s approval could threaten the viability of public finances as a freeze on public wages expires at the end of the year.

The government generated a fiscal deficit of 1 per cent of economic output in 2015 after posting a deficit of 8.9 per cent the previous year. In both cases, the deficit resulted from two successive capital injections extended to the cooperative banks. This year, the government is projected to generate a balanced budget expected to help it reduce government debt, which accounted for 108.9 per cent of the economy last year.


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